Confiscating Private Property Won’t Make America Great

The following column by Diana Furchtgott-Roth, a senior fellow and director of Economics21 at the Manhattan Institute, appeared at Economics21.org:

Everyone complains about government, and real estate magnate Donald Trump is promising to fix it and make America great again. But no one can help the economy by encouraging the government to take people’s property. The Soviet Union, Cuba, and Venezuela have tried it without success.

Unfortunately the Supreme Court in the 2005 Kelo v. City of New London case gave the government the right to take people’s property for any economic development project, a process called “eminent domain.” Susette Kelo’s house was seized so that New London could build housing, office space, and stores. Kelo’s house was destroyed, but the city’s project was never started. It’s yet another case of government planning gone awry.

Encouraging eminent domain leads to corruption and cronyism, where friends keep their property and enemies lose it. It opens the door to bribery and extortion of campaign contributions.

Trump loves eminent domain. The most famous case of Trump trying to take away private property occurred in the mid-1990s. Vera Coking, an elderly widow, lived next to the Trump Plaza hotel and casino in Atlantic City, NJ. Trump wanted to build a parking lot for limousines on that property and several neighboring ones. When Coking refused to sell, Trump appealed to the Casino Reinvestment Development Authority to seize it via eminent domain.

Coking eventually beat Trump in Superior Court—the court held that “the primary interest served here is a private rather than a public one and as such the actions cannot be justified under the law.”